Vermont Legislature SmartTranscripts:

[Chair Amy Sheldon]: Hello. Welcome back to this joint meeting of House Environment and the Natural Resources and Energy Committees. I'm shifting gears to talk about the bottle bill, and we have remote guests joining us, to share a report that they authored to help us understand the status of the bottle bill and and some recommendations. So welcome, I guess, Risa and Rachel remotely.

[Rachel Perlman (RRS/SignalFire Group)]: Great. And just checking. Can you hear us and see us? We can. Yes.

[Risa Demino (RRS/SignalFire Group)]: Yeah. And apologies, folks. This is recent Mino. I am unable to use my camera today. So but happy to see all of you. Just wanted to do a brief introduction and and introduce myself and then I'll hand it over to Rachel to make the presentation. My name is Risa Demino. I am co CEO of RRS and a managing partner in our policy subsidiary, the Signifier Group. We are very pleased to have been chosen by the state to do this really important work and in doing so, provide you with some data and information to inform your policy discussions. So we're really excited to share the results of that work today with Rachel, Rachel will walk through and we look forward to any questions that you have and any discussions you'd like to have at the end. With that, I'll hand it over to Rachel.

[Rachel Perlman (RRS/SignalFire Group)]: Great. Thanks. Nice to be with you all today virtually. My name is Rachel Perlman. I'm a consultant at RRS and, with the SignalFire Group. So I'm gonna walk you through this. We should have time at the end for questions, but if there's any clarifying questions along the way, please feel free to jump in here and ask. So we're going to be covering the analysis we did. And here's just an overview of what we'll be talking about today. We're going to start with the key findings just to get that up front, then go through the background and overview of the three models we analyzed for different bottle bill scenarios, go over the methodology in brief, focus most of the time on the impacts that we analyzed, the different material diversion rates we saw from the models, the cost estimates, greenhouse gas emission estimates, and litter. And then we'll end with next steps and open it up to discussion and questions. So we're going to go into what the three models were, but just as an overview of the key finding of the three models studied, Model three, which includes program management by a PRO, a producer responsibility organization, and also the expansion of what would be covered under the bottle bill, that scenario model three performs the most favorably. And so it's the most cost efficient on a per container basis. Using that metric, it leads to the highest volume of diverted containers to recycling, and it has the greatest reduction in greenhouse gas emissions. And also to the best of our understanding around litter, it has the greatest reduction in litter. All right, so just in review of what this study covered. Oh, was there a question?

[Chair Amy Sheldon]: Well, the posted presentation is not matching what you are walking us through, so we can't follow it on our iPads.

[Rachel Perlman (RRS/SignalFire Group)]: Oh, okay.

[Josh Kelly (Solid Waste Program Manager, VT Agency of Natural Resources)]: This is backwards.

[Rachel Perlman (RRS/SignalFire Group)]: That I think that would

[Representative Rob North]: be If

[Josh Kelly (Solid Waste Program Manager, VT Agency of Natural Resources)]: you go up, you'll find the the background section. It's near the top.

[Chair Amy Sheldon]: And and I think it's the last slide. The last slide. Yeah.

[Rachel Perlman (RRS/SignalFire Group)]: This is only new slide, if that's helpful. So I think all of the slides should match going forward.

[Chair Amy Sheldon]: Oh, okay. Well,

[Josh Kelly (Solid Waste Program Manager, VT Agency of Natural Resources)]: I don't

[Chair Amy Sheldon]: if it's okay. You had a welcome slide. Anyway, go ahead. We'll see if we can catch it soon.

[Rachel Perlman (RRS/SignalFire Group)]: Okay. Do you want me to give you a minute? Would that be helpful?

[Chair Amy Sheldon]: No. Oh, I see. Background. Okay. No, go ahead.

[Rachel Perlman (RRS/SignalFire Group)]: Okay. Yeah, we just added that finding slide at the beginning, just so we didn't bury the lead. But, yeah, so the DEC, the ANR of Vermont DEC commissioned SignalFire Group to conduct this study and designated what the three scenarios would be. So we analyzed the cost and benefits, financial and environmental, associated with three models for the management of beverage containers via what's known as the bottle bill deposit return system, and also Vermont's regular recycling system. So just to overview our Vermont's current state of the system, the state currently has 54 redemption centers and 69 retail redemption locations collecting covered beverages. And this is a total of 123 sites. The program places a 5¢ deposit on beer, malt beverages, mineral water, mixed wine drinks, soda water, carbonated soft drinks, ready to go drinks, etcetera, and then a 15¢ deposit on liquor. So most items have a 5¢ deposit. The study doesn't change any assumptions around deposit value. That remains the same. And the redemption estimated to be 72% for containers covered by the bottle bill. And just a reminder of what redemption rate means, it's the quantity of containers redeemed in the bottle bill system, abbreviated by BBS, divided by covered containers, so the total amount of containers covered by the law. And in 2023, H. 158 was introduced but did not pass, as you know, with the aim of expanding the scope of covered beverages. So there's still ongoing discussions, so hence the study. So this and the next slide will overview the differences between the three models. Model one is the existing bottle bill system as it stands and also the current recycling system. So no assumptions were made changing anything, only just trying to understand the current system for Model one. Model two has a Model 2A and a Model 2B component, which are slightly different, but both are modeling a PRO managed bottle bill system. So under this, all currently covered bottle bill beverage containers, except liquor, are managed by a beverage manufacturer distributor, PRO, Producer Responsibility Organization. In this scenario, convenience is also increased. So a convenience standard is established to increase redemption sites, and this convenience level is similar to that described in H-one 158. And another difference between Model two and the existing system is that because of the PRO, sorting by brand at redemption sites is eliminated. So that's a change. And all redemption sites must accept all redeemable containers, not just what they sell, so that increases convenience for the consumer. The difference between 2A and 2B, model 2A relies primarily on bag drop systems as a form of collection, although there is a little RVM reverse vending machine in that model. And then model two relies primarily on reverse vending machines. So it's the technology focus is different in those two models. And then Model three, the expanded bottle bill with the PRO is a version of all of the elements of Model two, but then additionally expands the type of beverages included in the Bottle Bill Deposit Program as originally proposed in H-one 100 '58. And then just to put all of that information in another way of viewing it, you can see here the key differences between the models. So Model three has significantly more beverages included, with the exceptions of those listed there, the exempt beverages and brand sorting is not needed at the point of redemption for Model two and Model three. And then with the in the current system, there's a commingling agreement that contains the majority of beverages, and now it's all beverages in the sense that there's no brand sorting required. And then, in the current system, we have a handling fee set that's fixed, 3 and a half cents for commingling and 4¢ for other beverages, for other beverage containers. In Model two and Model three, there's no set handling fee. It's not fixed. Rather, the PRO negotiates the appropriate compensation for the redemption sites, which would likely be based on a per container fee. And as I mentioned, Model two and three have increased convenience. One thing that's not changed is DLL is still handling liquor in the scenarios II and III, so that doesn't change. And then by means of having increased convenience, the number of redemption sites is higher, for models II and III. So instead of 123, we have 170 in the model. All right, I'll move along here to our methods. So the approach we took started off with data collection, and you'll hear a lot about the data and the results soon, and stakeholder engagement. So we conducted many interviews with redemption centers. And then we also talked to a number of stakeholders that I'll describe in the next slide to understand what data they had that might not have been publicly available already, and also just to understand perspectives on on what should be included in the model. So what we modeled, we modeled the bottle bill system, but we also modeled the recycling system. So beverages or covered beverages containers are going through both the bottle system and the recycling system, so both are at play, and we have metrics describing both. We also modeled separate trips taken by consumers to redeem containers or recycle containers via drop off, where drop off is the mode of collection. We modeled greenhouse gas emissions for different scenarios, bottles from out of state redeemed in Vermont, the impact of eliminating brand sorting with the establishment of a PRO, and also modeling the impact of choice of technology and how that impacts redemption rates and consumer engagement. That's a high level. So in terms of the stakeholders consulted during this process, we talked to the folks listed here. They offered really helpful information at different points of the study and with key stakeholders that had, have their own data on various aspects of this system. There was quality control in running results by certain stakeholders to verify that it matched or was similar to their own understanding of the system. And then some of these stakeholders provided data on things like litter to the extent possible. And then the interview piece was also really helpful. We spoke to 21 different redemption sites, so the managers or owners of those sites, to understand their current process and costs and how their operations could change under these scenarios. Right. So we're going to get into the impacts in just a minute. I'll just mention that there are a couple considerations to keep in mind when interpreting the results. So in model one, the current system doesn't have in as we know in our in the current system, there's not full compliance. So if there was complete compliance and full convenience levels, the model one costs that you would actually be higher by an estimated percentage of 20%. So just keep that in mind that model one would look to have higher costs if there were complete. And then model two and model three, they quantify costs associated with increased convenience. That said redemption rates remain the same. The expanded bottle bill systems can increase overall beverage container diversion by capturing more beverage containers. And these are coming from trash and litter, but also pulling containers from the recycling system. We'll go for that a little more. And then brand sorting, as I mentioned, is eliminated in Model two and Model three. I'll just say that when we did those interviews with redemption centers, there was a very wide range of responses for what the impact would be on potential labor savings and therefore cost savings when you eliminate brand sorting. So the analysis we present reflects an average savings, but that impact would be sensitive to a change in estimate on the labor savings. So that could, you know, you could always change that estimate and see a difference, but an average is used. So that could be just like a, just a note on the point of modeling. All right, so we're gonna get into the estimated impacts of these models. So I'm gonna start out with material diversion rates. So how many beverage containers are we seeing move, to the recycling system I'm sorry, to recycled, through either of the systems. So in model one and model 2A and model 2B, which are the bag drop and the reverse vending machine models, the diversion of beverage containers through both the recycling system and the bottle fill system remain at current levels. And when I refer to diversion rate, just here at the bottom, that's measured by the containers redeemed, through the bottle bottle bill system and the containers recycled through, you know, the blue bin recycling system or drop off recycling system divided by all containers. Those are the containers covered under the bottle bill system and the containers not covered by the bottle bill system. So diversion rate remains the same between model one and model two. But in model three, there's an increased diversion through the expansion of the bottle bill. So that increased diversion is coming through the fact that more containers are coming to be redeemed. And then there's also some of the bottles are coming, as we mentioned, from the recycling system, and some are coming from the trash and litter. And then just a note here that diversion rates for all beverage containers include collection through both of the recycling system and the bottle bill system. So any questions on that point? So I don't want to. Don't want any confusion on the terms. So I know that can be. A little confusing.

[Chair Amy Sheldon]: Yeah, representative North has a question.

[Representative Rob North]: Thank you for the presentation. Just a question on the. The clarification of the terms. Is the redemption rate and the diversion rate, are those the same thing then, or are they not?

[Rachel Perlman (RRS/SignalFire Group)]: They're actually different. Yeah, Risa, and I don't know if you wanna jump in with another version of an explanation, but I'm just looking at where we had the redemption rate.

[Risa Demino (RRS/SignalFire Group)]: Yeah. The redemption rate is the rate of redemption of things that are covered under the bottle bill system. So it's the containers redeemed divided by covered containers. And the diversion rate looks at all beverage containers and then everything that's recycled both through the container, but through the bottle bill system and through your curbside and drop off recycling system. So it it there's a larger universe of containers as the denominator because it includes things that are covered by the bottle bill and things that are not covered by the bottle bill. And it there's also a larger numerator because it includes things that are redeemed through the bottle bill as well as things that are recycled through curbside and drop off. Does that make sense?

[Representative Rob North]: Yeah. Yes. I understand the definition. Thank you. I'm just wondering then why you still chose to stick with the 72% as a diversion rate in model two.

[Risa Demino (RRS/SignalFire Group)]: Yeah, and that is, well, Rachel, do you wanna explain that and then I can provide maybe a more simplified?

[Rachel Perlman (RRS/SignalFire Group)]: So this actually wasn't like a, it was the outcome of the study showed that the diversion rate remains the same, notit wasn't an assumption. The redemption rate, which is different, did remain constant as an assumption throughout all three models because there's no data to show that redemption rate, which is not the rate being shown here, it's the other rate, there's no data to show that that changes, with increased convenience. So, what you're seeing here is the output of the model. So it doesn't change from model one to model two.

[Risa Demino (RRS/SignalFire Group)]: And and, basically, the the the redemption rate is let me see. I'm trying to figure out how to explain this. That that why the model wound up with the same diversion rate in model one and model two is essentially the redemption rate is consistent across the board for bottle bill containers. The recycling rate is slightly lower, but applied to a larger amount of material because you have that all containers circled. So the recycling rate is applied to a larger amount of material. So it's a lower rate applied to a larger amount of materials, but it it keeps the essentially results in the redemption rate and the diversion rate being the same. So that, as Rachel said, it wasn't a choice that we made. That was the output of the model based on applying the recycling rate to all containers and the 72% redemption rate to containers covered by the bottle bill. So it is a strange coincidence, essentially.

[Chair Amy Sheldon]: Did

[Risa Demino (RRS/SignalFire Group)]: that make sense? Did we explain that clearly? It's a little bit it can be confusing. I know.

[Representative Rob North]: I'll take your word for it.

[Rachel Perlman (RRS/SignalFire Group)]: And we can this data is shown in a couple different ways throughout this, so this next slide might help. Hopefully, it doesn't confuse further. So on this slide, the bar graphs are paired. So there's two vertical bar graphs for each of the three models. The first one is showing generation, whether the containers are covered or not covered. So the darker red are the covered containers. The lighter pink is not covered. So only, so model one and two look identical because there's no change and there's no expansion in model two. Model three has expansion. So there is a much greater number of containers now covered in the system, potential for redemption. And then the bar graph on the right of each of the pairs is showing the disposition where these materials end up. The darker blue on the bottom of each of these is the containers redeemed. The slightly lighter blue are the containers recycled through the recycling system. And then the tan color is containers disposed. So you can see how model one and two look identical because of what we just spoke about. And these are in tons of material. And then in model three, have a greater number of containers that are redeemed. And then the total number of containers between the two blue colors, that total blue is increasing from model two and one to model three, it's higher. And so that's representative of the higher diversion. And so this is just another way to look at the picture. So in Model three, more containers are covered by the bottle bill and more containers are redeemed. And this increase containers redeemed occurs as containers are pulled from both the recycling and the trash streams. That's just another way to look at it. Alright. I will keep going. So we looked at costs, for the bottle bill system using both system level cost and per container cost. For the system level costs, you'll see that in the first row of the table on the bottom. So Model one, 2a and b have similar costs at the system level. So that 9.4 for model one, 10,500,000.0 and 9,200,000.0 for model two a and two b. And model three has a higher, the highest system level cost to support the increased container throughput. So it's a larger program, more bottles, covered. And on the per container cost, you'll see, a different view, in that you're seeing, you know, everything divided by the number of containers. So model three is the most cost efficient on a per container basis at that point zero four. And this is because there's an increased throughput, of containers and there's, an adoption of a strategic mix of technologies. So with this higher volume, there are what are called bulk reverse vending machines that can process more faster and at high volume redemption centers. So those would be in larger communities, more dense parts of the state, and a combination of retail reverse vending machines and bag drop to meet required convenience standards in other parts of the state. And And then I just have a note here that if model one met the same convenience standards required in model two and three, that per container cost would go from 0.05 to $0.059 So it'd be an increased cost if the current system had higher convenience. I'll pause here. Any questions as you Senator Watson, So ask a

[Senator Anne Watson]: in model 2B, where that focuses on the reverse vending machines, Rob, in a prior slide, it mentioned that all locations that sell product would be required to redeem something and about 5,000 square feet. So does that mean that all of those locations would be required to have a reverse vending machine?

[Rachel Perlman (RRS/SignalFire Group)]: Most of them would. That, yeah, that 5,000 square footage cutoff allows, like, small convenience stores and similar locations to be looks like the small ones to be exempt. And then in these scenarios now, all beverages are collected at all sites, not just the ones they sell. So there could be, there's more convenience for the consumer. But, yeah, the most of those locations in this model would have reverse vending machines, but there could be some other mix of bag drop, but not but the primary mode would be reverse vending.

[Senator Anne Watson]: So even in the model two b, it could be a mix of reverse funding machines and bag drop?

[Rachel Perlman (RRS/SignalFire Group)]: Yeah. I I think we and we were looking at specific factors that would be I'd have to go back, but just like the there are certain cases where reverse spending might not be appropriate. A more rural community might have backdrop.

[Senator Anne Watson]: Thank you.

[Rachel Perlman (RRS/SignalFire Group)]: Okay, and then so we just looked at the bottle bill system costs. Now we're looking at the recycling system and how these models are performing in the recycling system. So there's no change in the system level costs between model one and model two for the recycling system. There is a 2% increase in system costs for Model three due to the loss of revenue resulting from the expanded bottle bill. So some of those high value containers may move from their recycling system to the bottle bill system, decreasing revenue. And then container costs is reduced for Model three as fewer containers are recycled through the recycling system and instead recycled through the bottle bill system. And then on the per container side, Model one and Model two per container costs are the most cost efficient across both bottle bill system and recycling system on the per container costs. Well, model three is less cost efficient in the recycling system on a per container basis, largely due to the decreased throughput. So the main thing you're seeing here is the recycling the recycling system, the per container cost is increased in model three. So this is because we're looking at it from the recycling system lens. And in the next lens we'll see the full view. So here we're looking at the overall financial costs, so the combination of the two systems at play the bottle bill system and the recycling system, and it's weighted, to understand a per container cost overall. And what we see overall is that model three has the most cost efficient, outcome on a per container basis. And this is, given the reduction in cost with elimination of brand sorting, the increased efficiencies through technology adoption that we were speaking about, and management by the PRO, and then also the increased overall volume of containers collected. So the of the benefit of scale there.

[Chair Amy Sheldon]: Can I ask a question? You may, Senator Hardy. Thank you. I'm just

[Senator Ruth Hardy]: looking at these two slides. I understand, I think it's slide 16 where the cost to the recycling system. That's to the, what, the MRFs, right? Am I getting that right? To those of you who are recycling experts? And the overall financial costs on slide 17, is that a combination of costs to the MRFs and costs to redemption centers costs? What I'm most interested in is cost to the consumer or cost to the average Vermonter. So what's the cheapest option for my constituents?

[Rachel Perlman (RRS/SignalFire Group)]: Yeah, I'll answer and then maybe, Risa, you can also speak to this. We none of these slides speak to the actual cost to the consumer because in that sense, the cost doesn't change on the deposit. But the overall financial cost, I think, is the cost that best answers your question, because it is the cost to society, which then impacts, you know, things like ratepayers. So this is the best metric for the overall view because it does include, like you said, the recycling system encompasses the path that goes through the MRFs and the bottle bill system encompasses the path through redemption centers. And then this slide demonstrates a weighted picture of both systems in combination.

[Senator Ruth Hardy]: And does this Model $3.4 include what might be the potential cost to transition to the model? Or is it just once we get there, it's $0.40 per bottle?

[Risa Demino (RRS/SignalFire Group)]: It's actually 4¢. Yeah,

[Rachel Perlman (RRS/SignalFire Group)]: this is the cost when we're there, not the transition Okay.

[Senator Ruth Hardy]: So overall, expanding the system and increasing the number of containers that are relevant or covered is cheaper in the end.

[Chair Amy Sheldon]: It's just the

[Senator Ruth Hardy]: transition cost. And do you have a slide that shows that transition cost?

[Rachel Perlman (RRS/SignalFire Group)]: No, the scope didn't focus on the cost of transition.

[Chair Amy Sheldon]: Okay. We're working on figuring out the cost of what it would cost to set up the PRO. Okay. Cool. Thank you. Representative Satcowitz.

[Representative Larry Satcowitz]: Yeah. Your your models have a a lot of numbers in them, and it's I my understanding is that the vast majority of these numbers are estimates. And so I'm wondering how good are these estimates? Like, what what's what's the uncertainty in the numbers? Because,

[Chair Amy Sheldon]: you know, when

[Representative Larry Satcowitz]: we look at the current slide, we're seeing fairly numbers that are fairly close. And if we're gonna be using these numbers to think of one model as being better than another, if the error bars around these numbers are significant, then we could easily see, you know, the order that we would place the the costs change dramatically.

[Risa Demino (RRS/SignalFire Group)]: I think that's fair. And but I also wanna point out that these estimates are based in reality, in actual program costs, information gathered from stakeholders in Vermont. And we did, you know, review these data with the Vermonters who were involved in these programs to, as Rachel said, do some quality assurance, quality control on our approach to make sure that what we're presenting here is as realistic as possible. We also draw on extensive experience within our S and Signal Fire group and in looking at these programs around the country and around the world. So I think they're very well grounded. But yes, they are estimates we we can't we don't have hard numbers until something actually gets implemented, but I would also point out that the the financial cost is one piece of the picture and Rachel's about to walk through some of the other pieces as well. And and so I think the the full evaluation is a bit more clear. But, yeah, to your point, there are no guarantees that these numbers will be absolutely accurate, but we did our level best to get real data and information to feed into these models. So I think they're as strong as they can be.

[Representative Larry Satcowitz]: Yeah. I no doubt that you did the work necessary to come up with the best numbers possible. My my question is really about, like, when we when we try to evaluate the meaning behind these numbers, you if these numbers were all plus or minus 1%, that would have a certain meaning. If these numbers were all plus or minus 10%, that would have a very different meaning. Without knowing where we're at, at least roughly speaking, I find it hard to make sense of these numbers. When they're presented here, they're presented as a comparison, point zero four three, point zero four seven, And the implication is that the point o four three number is is lower than the point o four seven number. And that would be true if we knew that the errors around your statistics were very, very small, which maybe they are. But if the errors around your numbers were substantial, which maybe they could be, then then this comparison would have would be a lot less meaningful. And so without knowing sort of what the uncertainty is with the numbers that you're presenting, it's really hard to have a to to make any sort of decisions based upon the numbers that you're showing us. It it just it's not helpful.

[Chair Amy Sheldon]: What about do you have error estimates?

[Rachel Perlman (RRS/SignalFire Group)]: So we did do some sensitivity analysis where numbers that had to be determined through understanding costs from stakeholders and having a range and then testing different levels and their impact on the output, scenario analysis was tested. But in some cases, quantifying uncertainty just wasn't possible with the data available. So the strategy we took in most cases was trying to verify the data used going into the model. So verifying things like sales data, actual cost data, cost of the different stages of handling things, understanding like the average distance of trips taken by consumers and how would trip travel, you know, those travel to drop off, how would that change? So yeah, I think the real Vermont data was used in any case where possible. So I don't know, Rice, I don't know if you have any other things to add on how we reduced uncertainty, but it is true we're not showing error bars between these three values, I understand the value that would provide.

[Risa Demino (RRS/SignalFire Group)]: Yeah. I think the other thing I would just say is that I think the relativity between these options would likely hold even if the numbers were slightly different because the differences in cost are based on factors like, you know, the bag drop is a higher cost because there's an additional processing system required in a bag drop. That's not gonna change if we misaligned on exactly what that additional cost was. It's still gonna be relatively more than the other. So so I I feel fairly confident that the relativity among these options would hold even if the numbers were to change a bit.

[Representative Larry Satcowitz]: Josh Kelly.

[Josh Kelly (Solid Waste Program Manager, VT Agency of Natural Resources)]: Thank you, members of the committee. And for the record, I'm Josh Kelly, solid waste program manager at the agency of Health Resources. At one point on cost is who's the cost to as well and what's changing in the models from model one to two. And I'm lumping two just for the sake of simplicity. The cost you're seeing here, who's paying? Distributors and manufacturers are paying some of this cost and when we shift to more standard producer responsibility models, that's traditionally 101 as you shift the cost burden of managing materials and then the blade to producers of it. So a lot of that cost is there, producers in Model two. And less so on retailers. There's still a lot of retailer cost in Model one that's not fully realized. That little tiny number nine goes back to 20%. If all of Vermont retailers were compliant, bottle bill, taking back what they're supposed to, then there's an estimated 20% extra cost there, which I I don't think we can downplay in how the bottle bill is working today. And then the recycling system, the regular place where many of our cardboard boxes go, takes some loss when when aluminum comes out. And so they have a cost here as well, and that's in these numbers. So it's it's not just the consumer per se. And and as we shift to more producer responsibility, more of this cost is really with beverage makers, at the end of the day. I hope that helps. And and so there's some, when you shift to model two, there is some changes to infrastructure and the and as this report does say explicitly who who ends up paying that more. And beverage makers pay more of the costs in any everything but Model one, and retailers start to pay a little less. The other piece is the handling fee, which is on every single container. It seems like not much, but every container has that handling fee. And those become more of a negotiation of these art bottles, and they could change potentially. It could go up, they could go down. It's hard to predict where you don't have to sort anymore, what what do we need to pay? And and and to your question, there is a chance that there's still manual redemption because you're only sorting by material type. So using your hands is actually pretty quick instead of having to have a big machine. So that made there was some assumption that some of the manual sort will continue, but it's just much faster than it's ever been. Sorry. Just context there.

[Chair Amy Sheldon]: I wanna be sure we get through this before the noon hour. I wanna do a public service announcement that updated slides have been added to the web page under the first word in the title is updated. So if you wanna I don't think the end of the slideshow is different, but just so you know, they have been posted.

[Rachel Perlman (RRS/SignalFire Group)]: Great. Yeah, so these are the other impacts that we measured. So we looked at greenhouse gas emissions, and we saw that the greenhouse gas emissions were estimated for beverage containers managed through the bottle bill system and the recycling system using EPA's waste reduction model, WARM. And we supplemented this with additional consumer trip information. Most Vermonters are driving, to locations. So model two yields a slightly higher environmental benefit. So when I say benefit, it's a reduction in emissions. So that's why there's parentheses around these because they're negative, they're savings. And so model two yields a slightly higher environmental benefit than model one. This is mostly due to reduced transportation emissions associated with a, a higher number of redemption locations, shorter trips. And Model three provides the most significant environmental benefit, the greatest savings compared to Model one and two. So you can see that by the larger negative number. I'm going to keep going for the sake of time, but we can always take questions on that. So litter was estimated. Expected litter estimates are expected to be the same for model one and model two with a slight decrease in model three as a consequence of expansion. So in model three litter decreases by about 22%. That's from four eleven tons in model one to, three twenty two tons in model model three. The estimates were, were done using the following data. Volumes were based on, the best available, but an older study from 2009, by Keep America Beautiful and then, also discussions in Greenup Vermont. Composition of litter was based on data from 2021 Keep America Beautiful study that suggests a composition of what's written there combined, and that data was combined with, per pound conversion factors. So what kinds of litter you'd see in this scenario would be 6% cans, seven percent PET, 1% HDPE, or number two plastic, and 86% glass by weight. So, that weight factor matters, because glass is heavier. And the estimated reduction resulting from expansion is estimated to be 40%. This is based on findings from a New York study that looked at the impact of expansion on litter between 02/2015. So we made an assumption that there would be similar, behavior, in another Northeastern state, which

[Chair Amy Sheldon]: is

[Rachel Perlman (RRS/SignalFire Group)]: certainly, an assumption with potential limitations. So not a lot of litter data available out there, but we used what was available. So those are the metrics, that were analyzed in this study. Just in brief, you have the report here, but it's also available on the DEC website. The report has metrics on cost, material flows and environmental impacts. It's intended to support evidence based policy decisions, and we're certainly available to answer questions. So with the remaining time, we can go back to any of the discussion that would be most helpful.

[Chair Amy Sheldon]: Yes. And I wanna make sure Josh has time to share what he came to share with us. So maybe we'll move to to Josh.

[Josh Kelly (Solid Waste Program Manager, VT Agency of Natural Resources)]: Thank you. Thank you, members of the committee, vice chair of each committee. Thanks for having me. I'm Josh Kelly from the Solid Waste Program at the Agency of Natural Resources. I've talked a little bit already about today's bottle bill, but I think I'll just summarize and say it's a fairly broken system right now. Established in the 1970s, we're hearing and experiencing that consumers are finding it harder to redeem, that their beverage containers, not all retailers are compliant and taking back beverages and redemption centers where most redemption occurs are struggling with the high sorts. They have over 100 grams they're having to sort at any one given time. And we've seen some closures and reductions in services as a result, direct result of those restraints. The bottle bill is a form of what we've talked about in this chamber of extended producer responsibility. If you sell a beverage that's covered, you have to make sure you have a pickup agent, you carry the deposit, and you remit the nickels, and essentially make retailers hold for the nickels that they've been paid out and then it has to be collected back. But it lacks many of the convenience standards that we have in other Vermont ETR programs. So we have our battery program, our paint program, our electronics program. It lacks some of the convenience standards and efficiencies that make those so successful. And really we feel that modernization is needed before we go to expansion, and include more beverages. We feel like there's a need to make system work better first and test that out. The report that you've just heard about is off there. It's taken me many months of working with these folks to go through it. And it represents model two and three agency developed assumptions as to what would work best in future, in different future states. So one of the things right out of the gate is model two doesn't really show cost a major part of this report. And Model two doesn't really show a difference in cost, but it is our opinion that it's likely to cost less over time. For example, the 120% cost could be increased if all retailers were redeeming as they should. That's not insignificant to me. And further, when redemption centers were asked about the decrease in cost for sorting, it was a mixed result. 60% said, yeah, there would be some elimination, but brand sorting would help us. We'd get some cost savings there. But 40% said it wouldn't save them that much. And so it was hard for us to well why what's the motivation there? Keep in mind redemption centers have been paid the same handling fee for years and literally decades. So their costs haven't they haven't really been able to update with the times. So that may be something in that data. What we have heard from redemption centers is that sorting is is really crushing their ability to continue doing this, this practice of redeeming containers. And we've seen some close and some, as I said, cut back hours. So I think that model two would likely cost less than model one. And then model three will cost more overall. It is likely that moving from model one to model three will increase the bottle bill system cost, just that bottle bill system cost, by an estimated 4,600,000.0 per year. And that it is the most efficient on a per container basis, but it's important also to look at the whole picture as well. Both are important. And then lastly, diversion or recycling rates. We get very confused by this and I apologize. It's funny that the amount of containers that we redeem is 72, and our overall how good is Raman at recycling our containers? Overall, all the containers beverage containers, it happens to be 72% as well. So that is gonna trip us up every time we talk about it. I apologize. It happens to be right there. A recycling rate and diversion rate is a big umbrella, and then redemption is a piece of that. And the bottle bill is very effective at getting 72% is good for a state, for a redemption rate. Massachusetts is more like 50. That's just more detail. So Model two is also, in our opinion, likely to see some recycling increases. While the report shows no change in diverging rate or recycling rate, this is mainly due to lack of available data and it's in the detail in the report. But based on the agency's experience, when we have had increased convenience for consumers with paint collection or battery collection, we see recycling rates go up. So in our experience, some increase in convenience will help assist. Model three will increase recycling. This is the one where moving from Model one to Model three is estimated to increase recycling 13 percentage points, 72% to 85. And those bottles and cans would be pulled partially from the regular recycling system. That's that 2% increased cost, which is an estimated $903,195 that the recycling system would lose out on. You know, a little less than a nifty per year. And then some bottles and cans that were previously disposed of in the trash and littered would also be captured. So that's a net environmental benefit. That really concludes my testimony. Make sure I give you guys time to ask questions.

[Chair Amy Sheldon]: Alright. Do members have questions? Yeah. I think I can do a seconds. Question. So

[Representative Larry Satcowitz]: I I really appreciate the points you just made about that there's certain factors that weren't modeled adequately, because we just don't really know how to put a good number on them at all, and so we didn't include them, and that you're trying to sit here and tell us, well, we we should think about those things, because they are important, and we know they're gonna make a difference, even though we don't know what the difference is. It

[Josh Kelly (Solid Waste Program Manager, VT Agency of Natural Resources)]: I

[Representative Larry Satcowitz]: think it really muddies the the water, you know, in a sense, because we're we're given this this model, which seems to be based on these very hard numbers, but then we're saying, well, there are these important factors here that we're not including in our model because we can't quantify them. It seems like it would be helpful when we get the get numbers to be able to have sort of scenarios with numbers associated with them that say things like what you just said, but in the same sort of format where we can say, here's what the model would would would tell us if, you know, the rates if the if the convenience rate if the if the fact that if things are more convenient increase the recycling rent by 5%, Here's how it would change our model. That kind of thing. And then we could get a sense of the sensitivity of the kinds of things that you're saying weren't included. It would just give us a better feeling for how the changes would actually affect those numbers?

[Josh Kelly (Solid Waste Program Manager, VT Agency of Natural Resources)]: I I tried to tie my testimony to two core things, cost and recycling. Is the juice worth a squeeze, you know, so to speak? 13% is not a significant change from 72% to 85, and that 4,600,000, because these models all predict sort of a producer responsibility type model, that 4,600,000 of extra cost is really, as the report says, it's mainly distributors and manufacturers that would bear that cost. That's what our battery program is like. Duracell and Energizer pay the cost of our recycling. We have one of the best battery recycling rates in the country. So it is hard to know these per container rates, and these costs are 100% ground truth. And I brought you probably little testimony, people have differences of opinion. This is a very hot topic. I think RRS did a pretty good job getting the data and then to get I don't sometimes scratch your head results when you say to a redemption center, we're gonna stop brand sorting. How will that improve things? And you don't hear, oh, that'd be wonderful. It's a little scary to think about change, I think, for everybody. So I don't know if that fixes everything you're saying. But but there is some cost here, and it's gonna be borne by some people, for sure, in the system. I'm sure people will need just fine about that if they

[Representative Larry Satcowitz]: My my thoughts are more just around as I'm trying to make sense of this, the places where I'm gonna go first is gonna be these charts and tables of numbers. Yeah. And without having the additional context and how that context affects those numbers sort of baked in in a more transparent way, it's just harder to to do the interpretation.

[Josh Kelly (Solid Waste Program Manager, VT Agency of Natural Resources)]: And we have this contractor, our retainer, to come and speak again if you'd like at least one more time. So and they've been very helpful. So if you wanna dig into it, we might

[Risa Demino (RRS/SignalFire Group)]: Alright. And just to add quickly on that point, there aren't any instances of a deposit program that has improved convenience without also increasing the deposit amount. And so we weren't able to identify what the improvement would be from just increased convenience. So that's what the analytical challenge.

[Chair Amy Sheldon]: That's a very helpful piece of information. Thank you. It's like the end of the the first episode in our conversation. Got us to